Connected TV

MVPD and vMVPD: Differences and Similarities Explained

MVPD and vMVPD: Differences and Similarities Explained

7 Min Read

Before the rise of streaming services, television ads were the pinnacle of advertising. They allowed companies to reach a larger audience than radio or print promotions, and advertisers could target their efforts by carefully selecting the channels, shows, and time slots for their ads.

Although an overwhelming majority of U.S. households still own at least one television, the number of traditional cable TV and satellite TV subscribers has dropped significantly. Many households instead use their televisions and mobile devices to stream shows on demand.

Given this changing landscape, marketing professionals need to understand the differences and similarities between MVPD, vMPVD, and other video advertising channels.

What Is MVPD?

MVPD is an acronym that stands for Multichannel Video Programming Distributor.

MVPDs are service providers that deliver multiple television channels to their customers or subscribers. Although cable and satellite TV companies may be the first examples that come to mind, MVPDs can take many forms.

How Do MVPDs Work?

Companies that operate under an MVPD model bundle channels together and sell them to customers as a package. Traditionally, MVPDs might offer several package options at different price points but give customers little (if any) room to customize their packages. 

MVPD Providers

The most well-known MVPD providers in the U.S. include the following:

  • Altice USA
  • Breezeline
  • Cable One
  • Charter Spectrum
  • CenturyLink
  • Cox 
  • Comcast Xfinity
  • DirecTV
  • DISH
  • Frontier
  • Mediacom
  • Time Warner
  • Verizon FiOS

Over the last decade, several telecommunications companies have merged, rebranded, or expanded their offerings. For instance, AT&T acquired DirecTV in July 2015, and Atlantic Broadband rebranded itself as Breezeline in January 2022. Meanwhile, CenturyLink expanded and reorganized its offerings when it became Lumen Technologies in September 2020.

Let’s cover some of the pros and cons of MVPD.

Pros of MVPDs

MVPDs offer speed and simplicity to their customers. When you sign up for a cable or satellite TV service, you get access to a wide range of channels with a single monthly bill. These services are familiar to most customers and can typically be bundled with home phone and internet services. Most providers even include a feature that allows you to record your favorite shows if you can’t catch them live.

Cons of MVPDs

As more and more content becomes available online, the drawbacks of the traditional MVPD model have become increasingly apparent. Though customers can choose from multiple channel packages, they nearly always pay for at least a few channels they never watch.

MVPD programming also requires specific equipment, which limits where you can watch. Because of these drawbacks, traditional television advertising is not as effective as it once was. Advertisers can still reach a large and relatively targeted audience with a well-placed TV ad. However, many Americans have “cut the cord” in recent years, ditching their cable or satellite TV subscriptions in favor of streaming services—particularly those that offer a vMVPD component.

In fact, eMarketer estimates that less than half of U.S. households will have a traditional MVPD subscription by 2024.

What Is vMVPD?

vMVPD is an acronym that stands for Virtual Multichannel Video Programming Distributor.

The key difference between MVPD and vMVPD services is that the latter delivers content via online streaming rather than cable, fiber, or satellite technology. In addition to scheduled, linear TV content from the same channels as MVPD services, vMVPD providers typically offer video-on-demand (VOD) content.

How Do vMVPDs Work?

vMVPD services function by obtaining streaming rights from television networks, and providing a curated mix of live channels and on-demand content over the internet, including SVOD, AVOD, and TVOD. Subscribers can access these channels through dedicated apps or websites on smart devices, offering them enhanced flexibility in where and when they watch.

vMVPD Providers

Popular vMVPD providers include the following:

  • DirecTV Stream
  • fuboTV
  • Hulu + Live TV
  • Philo
  • Pluto TV
  • Sling
  • Spectrum On Demand
  • Xfinity On Demand/Stream
  • YouTube TV

Many MVPD providers now offer vMVPD and VOD services as well. For instance, AT&T offers both DirecTV and DirecTV Stream, with the latter giving customers the ability to watch their favorite channels live and view on-demand content via mobile devices.

Here are some pros and cons of vMVPD.

Pros of vMVPDs

vMVPD generally offers more benefits and fewer downsides than a traditional MVPD service. Customers still get access to multiple channels from a single source, but it’s typically cheaper and with more customization options.

With vMVPD, you can watch live TV from anywhere with an internet connection. Most vMVPD providers also stream on-demand content, and some allow you to download some shows for offline viewing. To attract customers who favor cord-cutting to save money, vMVPD providers may offer “skinny bundles” with fewer channels and a lower price than MVPD plans.

vMVPD also gives advertisers a better reach as traditional cable and satellite TV subscriptions continue to decline. Because many vMVPD services also offer VOD content, advertisers can choose from more ad delivery options. vMVPD advertising also generally enables more insight and better ad targeting.

Cons of vMVPDs

vMVPDs require a high-speed internet connection, which could be a drawback if you don’t already pay for home internet.

However, if you sign up for a vMVPD package from the company that provides your WiFi, cell phone, or home phone service, you may qualify for a bundling discount. Otherwise, vMVPDs can actually save you money by removing the need for special equipment and the accompanying fees.

MVPD vs. vMVPD: Summary of Differences

Understanding the differences between MVPDs and vMVPDs is crucial when comparing their infrastructure, pricing, and channel selection. Here’s a quick summary.

Infrastructure

  • MVPDs use physical infrastructure like cable lines or satellite dishes, requiring set-top boxes for access, leading to high-quality transmission but additional equipment and setup costs.
  • In contrast, vMVPDs stream content via the internet, accessible on various smart devices without special hardware, offering greater flexibility with a stable internet connection.

Pricing Structure

  • MVPDs typically offer tiered packages with bundled channels, involving long-term contracts and extra fees for premium content and equipment rentals.
  • Meanwhile, vMVPDs provide a base subscription price with add-on options and no long-term contracts, making them more competitive.

Channel Selection

  • MVPDs offer a wide range of channels, including local and premium options, but customers may have to pay for unwanted channels.
  • On the other hand, vMVPDs focus on popular, high-demand content with fewer overall channels, providing more personalized viewing options tailored to specific interests.

How Do CTV and OTT Fit Into the Picture?

Most discussions of vMVPD also mention Connected TV (CTV) and Over-the-Top (OTT).

  • CTV refers to content delivered to viewers via internet-connected devices such as smart TVs, gaming consoles, and streaming apps.
  • OTT refers to content that goes “over the top” of your cable box — i.e., content delivered via the internet rather than traditional cable or satellite equipment. 

You might hear CTV used exclusively to refer to the devices themselves. Some narrow the definition further to include only TVs that access digital content — excluding mobile devices, computers, or other streaming devices. Some advertising experts use OTT to refer to the content itself and CTV for the devices used to stream it, while others use the terms interchangeably.

Regardless, CTV and OTT generally describe streaming services that provide on-demand content as opposed to linear TV. These services typically have apps for smart TVs, devices that connect regular TVs to the internet, and mobile devices. Examples include:

  • Netflix
  • Hulu
  • YouTube
  • Peacock
  • HBO Max
  • Discovery Plus
  • Disney Plus
  • Paramount Plus
  • Apple TV Plus
  • Amazon Prime Video

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MVPD and vMVPD: Final Thoughts

MVPD isn’t entirely obsolete, especially for older audiences. However, as more consumers ditch their cable or satellite TV in favor of streaming services, advertisers may find more success advertising through vMVPD, CTV, and OTT.

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